GBPUSD support and resistance lines. Click on the image to zoom in

My GBPUSD H4 chart for 18th January 2009

Or click here to see the “mind-map” online.

Cheers!

EURUSD

EURUSD Elliot Wave

EURUSD seems to be displaying a perfect Elliot Wave pattern on the H4 chart. If this outlook is correct, then next week we should see a retest of the 1.3080 – 1.3000 area, followed by a big bullish run till 1.3800 – 1.3830 area. A breach below 1.3000 would invalidate this view and I will look to sell at a retest of wave 5’s low. If, instead, price will bounce off 1.3080 – 1.3000 and break 3’s low at 1.3333, I will look to buy at retests of former resistance lines that become support and finally I will sell short at 1.38 for some nice profit. This is my plan for the EURO.

GBPUSD

GBPUSD weekly outlook

This pair looks more bearish biased and the 1.4470 88.6% fib level is a key level. I will probably look to buy it if momentum is not strong near it, but I will do that cautiously, moving my stop to breakeven at +20 and taking partial profits at +30 pips. If that level gets broken, I will look to go short at a retest for a possible profit of 100 pips or maybe more. A break of 1.4470 would probably mean a break of 1.3 on the EURO, as these two pairs tend to be correlated, so I will watch this pair carefully. Another key turning point is 1.5 and I will look to sell on the first touch if momentum is not strong and then look for a breakout of this level, that would confirm my Elliot Wave for EURUSD also. So if 1.5 gets broken, I will also look to buy at that level once it becomes support.

USDCAD

USDCAD weekly outlook

USDCAD has a very strong resistance at 1.3000 and a break of that would mean a big bearish move on EURUSD and GBPUSD. A lot of time has passed though between bounces off that resistance, so when price gets there I will look to go short for a nice profit. USDCAD seems to be range-bound, floating in the 1.15 – 1.3 area and a descending wedge formation seems to have formed on the H4 chart. That will definitely be something to watch out for and look for a break of those trendlines. A break to the downside would be bullish for the EURUSD/GBPUSD pairs and a break to the upside would mean bearish continuation for those pairs.

EURJPY

EURJPY weekly outlook

I am looking for a short at 122 – 122.35 area, but cautiously. That’s a nice resistance line at confluence with a 50% fib, so it looks like a strong one. A break above it would signal EURO bullishness and I would look to buy at a retest of 122-122.35 resistance become support. Target would be over 100 pips.

GBPJPY

GBPJPY weekly outlook

I made a nice 50 pips on this one thursday and anticipated some nice moves I wasn’t able to play because of exams. Next week, it’s possible to see a break of 132 on the downside, so I would look for a short on a retest. I would probably also buy at 129 for a fast scalp, then sell short at the retest of 129 after it becomes resistance. For the upside, 137-137.5 area is a key resistance, at confluence with a 38.2% fib trendline drawn from a daily chart and we also have a 61.8% fib resistance line just below, so I would first look to go short there if it goes up. Then if it lurks back up to it, I will wait patiently for a breakout and then buy at a retest of resistance become support.

This is my trade plan for next week and these are the major moves I’m ready to face. Good luck to you all!

These are key support and resistance levels I watch out for on the GBPUSD chart. At these levels, price is likely to react in some way: retracement, breakout (continuation) or trend reversal.

Major support and resistance lines on the GBPUSD pair. Click the image to zoom in.